Dr. TOLA AWOSIKA is the Managing Director/CEO of Med-In Pharmaceuticals which owns a pharmaceutical plant located at Sagamu in Ogun state. The infusion plant produces mainly liquid medicines and has been producing since 2014. The plant has just embarked on massive expansion which will be commissioned in a few weeks’ time by dignitaries including former President OLUSEGUN OBASANJO, who is the keynote speaker and the LAGOS, OGUN and ONDO State Governors amongst others. MoneyCentral’s team of ANALYSTS were with Dr. AWOSIKA to hear his thoughts on the Nigerian healthcare sector and the role his firm is playing in bridging the health gaps in the country. Excerpts…
How have you been able to grow Med-In Pharmaceuticals to where you are today?
The industrial space in Nigeria is very under utilised in general, we don’t produce anything, we import 90 percent of what we consume in this country and pharmaceuticals are not exempt.
In 2013 the Goodluck Jonathan administration placed a ban on importation of Intravenous (I.V.) fluids which was to encourage local production before that we have already envisioned doing infusion plants. Of course that law encouraged us because the market is here. Infusion is something everyone uses from day one as a human being, till exit.
It cuts across gender, age, it doesn’t really matter.
So the market is basically populated. It is not a specialised medication that requires a certain kind of illness to treat. Infusion is probably the first thing they will give you when you get to the hospital.
It makes sense for us to do that and in 2014 we started production and we quickly realised that we are under capacity and we had to try to expand as quickly as possible. Which is what we have started in 2019 and will be commissioned in a few weeks.
What have been the challenges in setting up the plant, and how are hospitals and pharmacies accepting your products?
Of course infusion is one of the most difficult approvals you get in terms of medications because it goes directly into the bloodstream, it requires a lot of procedures, a lot of approvals, a lot of regulators.
NAFDAC (National Agency for Food and Drug Administration and Control) will be one of them, it even goes as far as WHO (World Health Organization) approvals so that you will be able to export to conflict zones in West Africa. Because there are not a lot of infusion plants across Africa in general.
Challenges were expected, some were not expected. Of course we know the nature of business in Nigeria, issues with power, logistics in terms of congestion in ports, bringing in equipment, clearing them, human resources issues getting certain expats.
Covid-19 was the biggest issue of course, the global pandemic that put a complete stop to everything. However, throughout covid-19 we carried on working, we literally had to lock up everybody in one building and get everyone to carry on working and doing the construction.
There were other limitations, we couldn’t get flights for engineers from Germany, India and China. All the restrictions and closure of the border, that was the biggest challenge. Like I always tell people this is Africa so that African- Nigerian factor will always be there. you have to anticipate challenges, you have to have solutions for them. Challenges will always come but we have overcome so many. We expect more to come and we are ready for it.
How do you manage logistics and ensure that products are available across Nigeria?
The key to a successful manufacturing supply chain is to outsource logistics. Majority of the companies, I don’t call them my competition, we see each other as partners, we are unified in a lot of things, pricing, in policy.
Every one outsources logistics. They get the goods across the various states that make it simple, it is an extra cost but it can keep you focused on the core business which is manufacturing.
Again it is still a problem because you have to deal with the problem they have to deal with in terms of explaining to your customers why things are delayed, trucks break down on bad roads. It is the Nigerian factor; it is the African factor. We try to manage our customers.
Again, the advantages are that our products are not something you can say I don’t want anymore. I am going to buy from this person, because you are not going to find it anywhere.
I know where I can find it, it is not water, it is not crackers, unfortunately you have to wait. It makes it easier.
Are all your products certified by the WHO?
Of course, these products go through very critical production cycles. It starts from water generation, because 90% of our raw materials are acquired from infusions, water. From the selection of plants, all the different levels of checks and tests are carried out.
We test our raw water, they go through chemical and biological tests before it is approved to be used for production. And then it goes to the machine which is in an air locked room. Everyone there is completely sterile. It goes for sterilization for three hours. And from there it goes to the packaging area where we conduct a leak test, particles test and every batch that is produced is tested.
Your quality assurance department is very busy throughout the production process. We have what we called a retention room. Every batch that we produce, we have to keep one carton for 4 years, it is 20 bottles in one carton in a retaining room.
It is a regulatory requirement by NAFDAC in case there is an issue with a batch. A batch has gone out and it is in the market. Of course each batch has a number, everything is there. It is very easy for us to track and recall. It is a very sensitive product because it goes directly to the vein and if anything goes wrong the person is dead. We ensure people do not bypass any of our processes, there is no 50/50, it is 100% everything that goes out.
Are you tapped into the global supply chains?
Unfortunately, right now we are short of supply. Between the four I.V fluid plants in the country, we only meet 30 percent of Nigeria’s demand. We are still expanding. All our machines are ready for phase two.
Right now we do 21 million bottles a year, we produce for infusion, just infusion alone. I am getting a machine that can give us up to 60 million bottles, the machine will be installed before the end of the year.
All the other IV plants are buying more machines because the market is there. The neighboring countries, the ECOWAS countries, require our products but we can’t supply them. We have to take care of our country first.
What is your approach to science?
I am not a scientist. We try to feed off on research that has been done. The pharmaceutical space is like a cartel; this covid-19 vaccine has exposed how political the pharmaceutical industry is globally.
For us who are manufacturers, we feed off of research, a whole lot of books we have to buy every year, these books were done by researchers who do the majority of the work for us.
What is the budget range for research?
Just for procurement of the required research documents, nothing alarming. We have a budget for new technology that is different. For example, new technologies keep coming out, we have technical departments that are constantly doing research on how we can improve our production.
New equipment that will speed things up, reduce production from three hours to one hour if possible.
Any support from the government?
We always want the government to do more, however we try not to rely on the government. They haven’t proven to be very reliable but as far as our regulators, we are getting support from them. NAFDAC, Standards Organisation of Nigeria, SON, we get good responses from them.
How did Covid-19 affect your business?
Just before covid-19, the plant was actually shut down because of expansion. I already had a plan and budget for a 12 months shut down period where I had to factor in a budget to keep my staff.
Again this is not a sector that you have to keep changing people. You have good guys, you keep them. The covid-19 coming was timely. I had no plan of laying anybody off anyways.
In 2020, what really affected us was the limitations in travel and logistics of getting equipment’s down from factories in India and China. All of them were closed, no one was producing anything. That caused a big delay but it was like a gift and a curse.
Because all of a sudden Nigerian government wakes up and realises that there is a big deficit in pharmaceutical and medical investment in the country and CBN and the government are calling us.
During Covid-19 I went to Abuja like seven times. Even when the flights were closed. They were sending planes down to come and pick us. They are asking us what we can do.
There is shortage of I.V fluid in the country, people are dying and they now begin to realize that they haven’t supported the sector enough and everyone is now using the fire brigade approach which is always the problem in Nigeria. Everyone has this fire brigade approach to things, we don’t plan in advance, no reserves and everyone is now in panic. It was a gift and a curse in the sense that they realised and began to shine more light in this sector.
Gracefully, God kept Nigeria. It wasn’t badly hit as projected. I think moving from post covid-19 now, as we begin to recover I think a lot more strategies are now being put in place, a lot more involvement from the government in terms of support.
They are engaging us in so many different things. You guys are already in the pharmaceutical sector; how can we invest in doing vaccines in Nigeria. They are almost imposing that every pharmaceutical company starts making vaccines. They are giving us good financial support, good interest rate to go out and build these plants.
Now they have realised that nobody in the world is going to help you, if you don’t help yourself. It is good because again we have gotten their attention. We are now beginning to do things the way it should be done all these years.
Med-In pharmaceutical has been the major player in the industry, tell us how did you go about that?
First of all is the grace of God but again the market is there, it is your appetite for investment, for wanting to be known, wanting to give back. This project was not just financially driven, it was an emotional one to fill in the gap in the country and by doing so, by virtue of doing it right of course financially you will be encouraged.
It is not a one-man show. I have never run a business in a one-man show fashion. I always tell people if you are the smartest person in the room then you need to leave the room, because these guys will drive you back.
I always ensure I have really gifted people around, I have people that can challenge you and make sure you are always on your toes. That is the success story, that is the brain behind it. Working as a team and not giving up. Always reinventing, good positioning. Even though it is a pharmaceutical plant, you have to put in the right ethics.
The plant is very modern, very well laid, we have blocks of flats for people to live in. Nice garden, trees, making the environment very conducive for people so people are motivated to work. And when you have a motivated workforce, half of the job is done. That is the story behind the success.
Nigerians overtime have been complaining about pharmaceutical products being very expensive but the reverse is the case when it comes to your company. How do you provide cheap medical products to Nigerians, especially the poor?
It is all about cutting your cost, and not all driven by finances, there is emotional commitment to better a country. The reason why things produced in Nigeria are very expensive is because the companies are not owned by Nigerians. So there is no sentimental attachment, that is the truth.
The companies owned by foreigners have no emotional attachment, for them they tie into a monopoly, they know you don’t have a choice, you buy it regardless of the price. We try because it is a way to better the country.
That is one of the things we discussed last week when we had a zoom call with the minister of health. The government has to step in, the raw materials are rising, you guys need to look for a way to give pharmaceutical companies good allocation in CBN to get dollars easily so that we can bring in raw materials.
So that we can regulate prices if not prices will keep going up and there is so much we can stock. We have invested in things like cost efficient engines, the plant runs 22 hours shifts, we use two hours to clean the equipment. We steam it, imagine the light has to be turned on 22 hours for the day, 25 days a month. You can imagine running on a diesel.
It is not all equipment that can run on PHCN because of inconsistency of power. If it stops your batch is completely ruined. One batch is 96,000 bottles. If my equipment goes off, my investment on that batch is gone.
You realise that if you are spending money buying diesel your production cost is going to go up but these guys don’t care they pass it on to the end users. I went to invest in my own power plant. I now have my own power plant, 3 megawatts power plant. I run my plant on gas. My gas is collected from the road, natural gas. It is a lot cheaper. But people don’t want to make that investment, they just increase their price, they know people will buy it. That is a wrong attitude when you are industrializing.
It is a volume business, not retail when everything is passed on to the end users, that is not how industries are designed. That is not how a country can become self-sufficient.
That is the biggest problem. If you want to solve the problem in Nigeria, you get more people involved who care about the country, who are patriotic. I think we will achieve some good results.
Tell us your approach to financing pharmaceutical production as it is capital intensive?
We have financial partners, the bank of industry has been helpful (BOI), they focused majorly on financing equipment. CBN recently formed a fund for pharmaceutical companies.
Giving us single digit loan interest rate direct borrowing. Forex is open for importation of raw materials. We are not there yet, where the country needs to be, everyone should enjoy that fund starting from the beginning. You can’t become big overnight. From the beginning these things should be available to everybody so that they can join the party.
You can’t say this guy has a 50-million-naira investment before he can enjoy these things. Everybody should be able to get that support as long as you are honest.
Tell us more about the launching of your pharmaceutical plant, what should Nigerians expect?
It is going to be a short ceremony, 29th of July. Which is Thursday from 10-12 pm. We strategically invited stakeholders, and it will be commissioned by the Executive Governor of Ogun state, alongside Lagos state Governor and Ondo state Governor.
The keynote speaker will be the former president, Olusegun Obasanjo. Industry captains, Bank of Industry director, the Managing Director of Providius Bank which is our corporate bank will be there.
Then the minister of health too will be there, to represent the Federal Government. We are looking forward to serving our country. Our end users, hospitals are definitely looking forward to having us back.
They have been sending requests for the last six months. It is going to be an exciting time to be back in the market. The staff are gearing up to get back into production, of course with expansion came expansion in staff as well.
Before we were doing one shift now we are doing three shifts. We had 110 people, now we have about 600 people that will be working 22 hours’ operation. We are happy to finally be here. We are looking forward to that day and getting back to work.
Will there be expansions in future to other geopolitical zones?
We are going to open a plant in Abuja, conversations are already on to fulfil the market in the north. Because logistically it is tough. Getting things from here to the north.
Tell us about your Foundation?
It is my personal project giving back to my community. Rural focused, we have quite a few projects that run concurrently throughout the year. In education, health care and basic infrastructure we want to have water for all initiatives.
Every quarter we build bore holes in rural areas. We also go into schools, education, give books to schools, focus on primary and secondary schools.
During covid-19 we were very active giving lots of lectures on how they need to prevent themselves from contacting the virus and how to protect themselves from spreading it.
We gave out a lot of face masks in the tens of thousands. We gave out testing kits to hospitals, hand sanitizers. We have a skill acquisition center in my state, Ondo. That is where the head office of the foundation is.
In that center we run concurrent skill training across different sectors, tailoring, computer literacy, hair dressing, baking, make up, all types of skills acquisition.
Education is not for everyone; you might have a talent you want to develop. And go ahead and turn it into a business. We are constantly running those trainings. We have short courses.
We have 12 week’s training, try to get three top students in the class, and try to get them an internship in well-established institutions. For tailoring I can send you to a celebrity tailor that I know, for music producer, I can send you to one of the artists. We try to plug people, giving them the opportunity to live their dream.
Of course I will always tell people if one Nigerian can help the other Nigerian there won’t be a problem in this country. We will do all we can to contribute our own quota. We can’t do everything.
We always do an event. We call it ‘Ondo has talent’, we have a panel of judges, we have celebrity artists. Like the American Idols, we have talents hidden across the country. We have to get them exposed.
You are going back to your roots; some other person might want to do it in Lagos?
We can’t keep developing in one place. You have to go and create solutions in other places where they are needed. In fact everybody has to go back, that is how Nigeria will become better. As young people we cannot keep quiet any more.
Let’s talk about recreation
I own a chain of gyms, fitness clubs. I have always been a fitness person right from school. I wake up every morning by 5 am. I go boxing, then I enter gyms.
Boxing helps me think. I don’t do it for protection. I played basketball when I was in university. I have always been a sports person, all round sport.
Again as a way of giving back to society, when my fitness club opened in 2014, we built these mega big gyms and we decided to price membership at 10,000 a month.
Our competition was averaging 45,000 a month. In six months all the gyms closed down. Then we grew from one member to 5, 000 members. We now have the biggest gym membership in the whole of west Africa. You are paying a fair price for premium service. I will try and replicate that in other businesses.
God bless you sir.